Are you struggling with you current debt amount, do you have no easy solution to resolve the problem? With so many different debts to pay and not enough money coming in, you might be wondering what you can do to sort it all out – is and IVA a solution that will help?

So what is and IVA?
An IVA is an Individual Voluntary Arrangement, it is a way for you to get out of your current debt situation, it’s a bit more complicated that a debt management agreement and normally run for 5 years. What an IVA does is calculate what incoming funds you have and what out goings you have, bills, debts and living expenses, then work an affordable monthly plan that is agreed with your current creditors with your IVA company for you to pay back your debt.

And IVA can be seen as an easier way out of debt, but this is not really true. Often companies you owe money too will only allow and IVA to fall into place if you are really struggling with your payments. As you can imagine there are so many people in the UK in debt, the company needs to be sure that you truly need the help in solving your debt problems. From this and IVA might not be the solution for your money worries. The IVA is only for people that are really having issues keeping up repayments and struggling with money, maybe due to a change in circumstances.

Is an IVA legally binding?
Yes they are legally binding, but only when they have been agreed by all parties, once this has happened the rules can not be broken and you have to stick to the terms and monthly payments. It is possible to include a rest period before you start the repayments; this gives you a break from paying all your debts included in the IVA. Not all IVA’s will include this sort of options.

One advantage of an IVA debt solution is that it often write some of your debt off, you simply make payments for 5 years, then after this the debt is finished, even if the total amount of the debt has been paid off. But not all your creditors will write off your debt. In most situations, the creditors will be happy to receive a lump sum rather than nothing at all, so this is why they often write off some of the debt owed. In the creditors’ eye is much better for them that you have an IVA than you declaring bankruptcy and then they don’t get a penny.

In conclusion and IVA is a very helpful debt solution and has helped thousand of UK individuals to get on the road to debt freedom, but to qualify for one you have to be really struggling with you current debt situation, also if an agreement is put in place it has to be stuck too – its legally binding don’t forget.

DeleteDebt.co.uk provides IVA Solutions and other debt advice for the UK including Scotland and Northern Ireland. Contact us today and start you journey to debt freedom.